[Guide] : In late June, unexpected shutdown of propylene market equipment occurred one after another, which was favorable to the supply side, while the enthusiasm of downstream products picked up, and the market price stopped falling, as of July 14, the mainstream transaction of Shandong propylene market price was 6480-6500 yuan/ton, and the mainstream transaction of East China market was 6350-6350 yuan/ton.

In this cycle, the domestic propylene market has stopped falling and recovered, and the factors supporting the market rebound are mainly in the fundamentals of supply and demand. Macro, international oil prices rose, the main positive factors are: the United States inflation data is good, the Federal Reserve to continue to raise interest rates pressure weakened, and Saudi Arabia’s additional production cuts brought about the continuation of the positive atmosphere, to the market. At the same time, the temporary parking of Qingdao Jinneng, Wangtong, and Zhenghe propylene devices in the region, while the early parking maintenance device has not been restarted, and the supply is facing the market with certain support, and the national PDH production rate is 69.79% as of 14 days, which is 0.2% lower than the previous cycle. With the fall of propylene construction, the inventory of propylene production enterprises is not high as a whole, the offer price is gradually pushed up, the downstream buying enthusiasm is better, and the overall trading atmosphere is OK.

In this cycle, the three processes of propylene are mixed, and the profitability of propane dehydrogenation to propylene is more obvious. On the one hand, the spot price of propane continues to fall at this stage, and on the other hand, the price of propylene monomer is strong, which gives a certain boost to the profit trend. The profit of naphtha and methanol to propylene continued to decline, and the profit of methanol to propylene process declined significantly, which was mainly affected by the rising price of raw material methanol, which hindered the profit. Naphtha to propylene process profit tends to decline from last week, the main influencing factor is the naphtha price narrow upward, but also on the profit driving drag caused, is expected to short-term propylene profit volatility trend, late pay close attention to the market price of raw materials.

In the short term, on the supply side, with the restart of PDH devices in Shandong, the load of the newly put into production in the early stage is gradually increased, and the propylene current supply is expected to increase, but the temporary parking of individual factory devices in Shandong will give a certain boost to the market. Demand side, at this stage, the polypropylene market tends to be strong trend, powder profit is OK, downstream factories just need to buy mainly, while next week PO, acrylonitrile factory is expected to restart, it is expected that the short-term propylene market may have a small rise, but the rise space is limited, follow closely to the restart and shipment of propylene manufacturers.

Demand side, the polypropylene market trend in the cycle, the demand side support is strong, the pre-stack propylene price fell to the low, the spread between propylene and PP expanded, the downstream factory profit gradually increased, the buying enthusiasm also gradually picked up, led to the smooth shipment of propylene enterprises, inventory position gradually to the low, support propylene prices up.